The Tax Publishers2020 TaxPub(DT) 4174 (Kol-Trib)

INCOME TAX ACT, 1961

Section 37(1)

Managing Director of assessee-company was Honorary Counsel of Ireland in his individual/personal capacity and an event was hosted by him at Hotel Taj Bengal to celebrate Ireland National Day in India in that capacity. Although guests related to business of assessee-company were invited to participate in said event, there was no evidence to establish involvement of assessee-company in said expenditure. Accordingly, AO was justified in disallowing deduction of expenses incurred on supply of beverages to Ireland Embassy.

Business expenditure - Supply of beverages to Ireland Embassy where director was honorary member - Assessee pleading guest related to assessee's business to have been invited to concerned event - No evidence to substantiate business purpose

Assessee-company claimed deduction of expenses incurred on supply of beverages to Ireland Embassy where Director of the company was Honorary Member and payment made to Hotel Taj Bengal. AO alleged personal element and thus disallowed deduction. Held: Managing Director of assessee-company was Honorary Counsel of Ireland in his individual/personal capacity and an event was hosted by him at Hotel Taj Bengal to celebrate Ireland National Day in India in that capacity. Although guests related to business of assessee-company were invited to participate in said event, there was no evidence to establish involvement of assessee-company in said expenditure. Accordingly, AO was justified in disallowing deduction.

REFERRED :

FAVOUR : Against the assessee.

A.Y. :


INCOME TAX ACT, 1961

Section 37(1)

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